Impact of the COVID-19 pandemic on global value chain and implications for the Belt and Road Initiative

초록

China's Belt and Road Initiative (BRI) has the merit of contributing to regional economic development in tandem with infrastructure investment along economic and transport corridors. However, the issue of its sustainability has been raised due to enormous capital requirements and low profitability. Moreover, the outbreak of the COVID-19 has caused incomparable economic damage and supply chain disruptions worldwide in the form of entry bans, quarantines, trade blockades, and global protectionism, which are barriers to international trade and work against the development of the global value chain (GVC). This paper aims to quantitatively estimate the impact of COVID-19 on GVC adjustment by region and industry and derives policy implications based on the decomposition of value added (VA) and vertical specialisation (VS) trade. It is estimated that the GVC will shrink by 4.8%-20.2% in terms of VS trade depending on various scenarios.

키워드